Does Branch Religiosity Influence Bank Risk‐Taking?

24 Pages Posted: 27 May 2020

See all articles by Justin Chircop

Justin Chircop

Lancaster University Management School

Michele Fabrizi

University of Padova

Elisabetta Ipino

Concordia University, Quebec - Department of Accountancy

Antonio Parbonetti

University of Padua

Date Written: January/February 2017

Abstract

Using branch‐level data on public and private US banking institutions, we investigate the importance of branch religiosity in shaping bank risk‐taking behavior. Our results show robust evidence that branch religiosity is negatively related to bank risk‐taking. This effect persists after controlling for several bank‐level and county‐level variables that might correlate with religiosity. Moreover, this result is robust to controlling for headquarter religiosity, suggesting that the effect of branch religiosity is additive and not washed out by headquarter religiosity. Overall, our findings document that headquarter religiosity does not capture the full effect of religiosity on bank behavior, as claimed by previous research, but that the religiosity of the geographic area in which the bank operates significantly influences bank behavior.

Keywords: religion, risk‐taking, risk aversion

Suggested Citation

Chircop, Justin and Fabrizi, Michele and Ipino, Elisabetta and Parbonetti, Antonio, Does Branch Religiosity Influence Bank Risk‐Taking? (January/February 2017). Journal of Business Finance & Accounting, Vol. 44, Issue 1-2, pp. 271-294, 2017, Available at SSRN: https://ssrn.com/abstract=3604460 or http://dx.doi.org/10.1111/jbfa.12227

Justin Chircop (Contact Author)

Lancaster University Management School ( email )

Lancaster University
Lancaster, Lancashire LA1 4YX
United Kingdom

Michele Fabrizi

University of Padova ( email )

Via del Santo, 33
Padova, Padova 35123
Italy

Elisabetta Ipino

Concordia University, Quebec - Department of Accountancy ( email )

Montreal, Quebec H3G 1M8
Canada

Antonio Parbonetti

University of Padua ( email )

Via del Santo 33
Padova, 35123
Italy
+39 049 8274261 (Phone)

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